Value Beyond Coverage: The New Era of Life Insurance

The landscape of life insurance is transforming. Today's policyholders, particularly younger generations, want comprehensive solutions that align with their lifestyles and provide tangible benefits from the first day of coverage. Providers are recognizing the importance of addressing the broader aspects of a policyholder's life, extending beyond the traditional financial safety net provided by coverage.

Modern life insurance policies are being enriched with value-added services (VAS) that provide a range of practical and emotional support services. Such offerings signify the insurance industry's response to the evolving expectations of today's consumers who want more than just transactional relationships with their insurance providers. They desire a partnership with their insurers that supports their overall health and wellbeing. The following are some examples of VAS from across the life market.

Wellness Programs and Gym Memberships

Many life insurers now offer wellness programs to promote healthy living among policyholders. These programs may include virtual consultations with nutritionists or personal trainers, telemedicine appointments, exclusive rebates on healthy food shopping, and paid subscriptions to wellness apps.

For example, the John Hancock Vitality Program provides eligible customers with access to multi-cancer screening tests and discounts on wearable fitness devices.  To encourage engagement, members can receive discounts on gym memberships, fitness devices, and even cashback rewards for staying active.

By incentivizing healthy behaviors, insurers aim to reduce the risk of claims and improve the long-term well-being of their policyholders.

Financial Planning Tools

Companies like Prudential, Northwestern Mutual, MassMutual and Guardian Life have broadened their services to include financial planning tools and resources. These insurers offer a variety of platforms and services, such as retirement calculators, educational articles, personalized financial advice, and guides covering retirement, education funding, and investment strategies.

Aimed at helping individuals and families make informed decisions for their financial future, these tools address a wide range of planning needs. Some like Fabric by Gerber Life are specifically focused on parents and provide guidance on UGMA accounts alongside their life cover. These tools support the overall financial health and long-term goals of their clients.

Wills and Estate Planning

Many life insurers now offer services to help policyholders with wills and estate planning. Mutual of Omaha , Foresters Financial and WoodmenLife are leading examples in this regard, and use Epoq’s LawAssure service to deliver legal services to their policyholders. These types of digital platforms give their policyholders a simple, trusted way to go online, answer a series of questions and create personalized wills, powers of attorney, trusts and healthcare directives that are tailored to the laws of their states. Other insurers offering online estate planning include Ethos Life and Western & Southern Group.

Legal matters can be complex and costly, often requiring professional assistance to navigate effectively. By offering access to digital legal services as a VAS, life insurers can enhance the overall value proposition of policies and provide customers with protection beyond financial compensation. In this way, policyholders can get assistance in addressing legal matters efficiently and cost-effectively, reducing stress and uncertainty.

Grief Counseling and Support

MetLife, Guardian Life, New York Life and others have introduced holistic bereavement support as part of their coverage. This may include access to professional counselors or support groups, online resources for coping with grief, and assistance with practical matters such as funeral arrangements. By providing emotional and probate support during difficult times, insurers are demonstrating their commitment to customer well-being and looking to create generational loyalty.

The new standard

Many life providers are incorporating VAS to enhance the value proposition of their core offerings. The insurance industry is at an inflection point and policyholders are beginning to expect comprehensive offerings that help them plan for the future and support them during difficult times.

To offer next-level support, insurers must have a 360-degree view of the policyholder with the view to delivering empathetic services that meet their needs. Delivering greater value will help carriers differentiate and stay competitive in a rapidly changing industry.

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